How a $7B Food Redistributor Meets Customers’ Evolving Data Demands
As food and beverage brands offer more niche products and expand their catalogs to meet evolving consumer tastes, the demand for efficient logistics and distribution to serve global customers in new ways has soared. Illinois-based Dot Foods plays a significant role in the process, developing innovative solutions for its food industry partners – manufacturers, distributors, operators – to increase sales opportunities and better serve the end customer.
In fact, the food industry redistributor plays such a role that it was recognized by Forbes as one of America’s largest private companies in 2017 (No. 63). But how did the family-owned and -operated Dot Foods, headquartered in a town with the population around 2,000 people and tucked into rural western Illinois – just a few stones’ throws away from the Mississippi River – grow into a $7 billion food redistribution business, the largest in the country?
Dot’s success might be traced to a couple of key factors:
- Identifying and effectively filling a gap in traditional food distribution models
- Providing a better service experience for its customers and trading partners
A critical component of that success stems from the fact that Dot can say yes to all the ways its customers want to electronically interact and communicate, making the company supremely easy to do business with.
What is Food Redistribution?
Food manufacturers are experts in product development, production, and marketing, but their transportation systems are not always set up to be the most efficient. In fact, most transport networks are only configured to efficiently sell full truckloads (FTLs) of product, which isn’t always ideal for smaller distribution organizations.
In the United States, there are more than 15,000 distributors, but many of them are not large enough to regularly order from manufacturers in full truckload quantities or cannot warehouse such large quantities for long periods. The solution to that problem is redistribution. Enter Dot Foods and its innovative business model, including its LTL (less-than-truckload) services.
As a food redistributor, Dot buys full truckloads from more than 900 manufacturers and consolidates their products in 11 distribution centers across the U.S. The company then resells these products in more manageable LTL quantities to distributors. This model helps:
- Manufacturers increase sales by giving them access to distributors they otherwise might not be able to serve
- Distributors operate more efficiently by providing access to tens of thousands of products without the added cost of inventory and warehouse space
While manufacturers compensate Dot to handle distribution of their costly LTL orders, there is no extra cost to the distributor when buying from Dot. That means Dot offers its 127,000 products to distributors in all 50 states and more than 25 countries at no additional charge. And for you, the consumer, this means all your favorite products continuously stock the shelves inside your local retailer at the expected price.
The Data Demands of Logistics, Distribution
The process sounds simple: Dot Foods receives orders from thousands of distribution customers, requesting items from various manufacturers. Dot compiles the items, many of which are stocked in Dot’s own warehouses, and delivers them to the customer.
But Dot’s unique role in the food supply chain – where the company simultaneously acts as buyer, seller, warehouse manager, redistributor, and shipper – means Dot must support a variety of data and electronic communication methods from its partners, suppliers, and customers. In addition to all the different protocols, applications, and data formats the company must support for its external B2B partners, Dot also uses a variety of internal applications that don’t natively communicate with one another.
Getting all these systems to work together requires significant amounts of custom code and manual data entry to keep business moving. However, to continue its growth and maintain its reputation as the premier food redistributor in the world, Dot Foods sought a better way to support its customers’ EDI and non-EDI – flat file, spreadsheet, XML, fax – orders from a single integration platform.
Read the full case study and learn how Dot Foods uses any-to-any data transformation technology to meet its customers’ increasing data demands and automate 80 percent of its order processing.